Energy Savings as Motivation for Digitalisation Projects

Research

ZEW Study for Ministry for Economic Affairs Recommends More Information and Training Programmes

Over the past three years, about three-quarters of companies in the information economy and nearly 60 per cent of companies in the manufacturing sector have undertaken digitalisation projects.

Over the past three years, about three-quarters of companies in the information economy and nearly 60 per cent of companies in the manufacturing sector have undertaken digitalisation projects. Companies now cite potential energy savings more frequently as motivation for such projects than they did in 2020. However, companies face several challenges in their attempts to improve their own energy efficiency. This was revealed in a representative survey of 1,500 companies conducted by ZEW Mannheim as part of a study for the German Ministry for Economic Affairs and Climate Action.

As part of the survey, companies that have carried out digitalisation projects in the last three years were asked about the key reasons for undertaking such projects. From the companies’ perspective, various motivations play a role, such as remote work arrangements or demands from customers or clients. “Many companies also cite potential energy savings as motivation. Among those undertaking digitalisation projects in the last three years, this applies to 27 per cent in the information economy and 42 per cent in manufacturing,” comments Dr. Daniel Erdsiek, a researcher in ZEW’s “Digital Economy” Unit. “This marks a significant increase in the relevance of energy savings as a motivation for digitalisation measures compared to our survey from 2020.”

47 per cent of media service providers that implemented digitalisation projects in the three years prior to the 2023 survey cite energy savings as motivation. Source: ZEW Business Survey in the Information Economy, 2nd Quarter of 2020, 2nd Quarter of 2023.

In the information economy, the proportion of companies mentioning energy savings has risen by six percentage points. In manufacturing, the relevance of energy savings has shown an even more pronounced increase. In 2020, only 30 per cent of companies mentioned energy savings as a reason – the least common among the seven reasons asked about in the survey. In both the frequency of mentions (plus twelve percentage points) and the relative importance compared to other drivers, energy savings have noticeably gained significance in the current survey. Today, it ranks fourth among the seven reasons for digitalisation queried.

Supply difficulties and a lack of skilled workers hinder energy-saving measures

26 per cent of companies in the information economy that have implemented measures to improve their energy balance in the past three years or are planning to do so state that a lack of internal knowledge about suitable digital technologies and applications has made it difficult or prevented measures to improve their energy balance in the past three years.

About one-third of companies in the information economy and half in the manufacturing industry have implemented measures to improve their energy balance in the past three years. Approximately 20 per cent in both sectors plan similar projects in the future. However, many companies encounter hurdles in executing existing or planned energy-saving measures. By far the most frequently cited challenges are supply difficulties and the unavailability of the required digital or non-digital materials and products, along with a shortage of skilled labour for installation and implementation. In addition, around a quarter of companies see a lack of internal knowledge about suitable digital technologies as an obstacle, or state that there are no suitable digital technologies for their specific needs.

“In light of this, it is important to address information and knowledge deficits. Especially small and medium-sized enterprises (SMEs) rarely exploit the potentials of digitalisation and energy efficiency.  They are much less likely than larger companies to implement energy efficiency measures or use digital technologies to improve their energy balance. Moreover, further training on digitalisation and energy-related topics is less common in small and medium-sized enterprises. For this reason, policymakers should pay particular attention to the barriers and challenges faced by SMEs,” explains Professor Irene Bertschek, head of ZEW’s “Digital Economy” Unit and co-author of the study.